Why Is My Organization Not Growing?
By: Sherry Quam Taylor
The energy and passion needed to successfully fund and launch a nonprofit is not the same energy and passion that will keep it moving forward. Growing your organization takes even more, and most leaders feel this playing out daily.
I’ve found that most nonprofits are full of passionate, thoughtful, and sacrificial leaders who have the ideas to make a great impact in the world. But I also know gaining traction and momentum to move forward isn’t easy. Often it takes an outsider’s perspective to bring clarity to problem areas.
Whether your organization generates $300K or $1.3M annually, growth will only happen when leadership adopts a growth mindset and then constructs and executes a tactile plan. I find that documenting the steps of this strategy is the only way to achieve the goals while also managing and growing the funding efforts. Execution must happen daily through dedicated, accountable staff members collaborating with guidance from the leadership and board. If you don’t have a staff, then pushing up and over this hurdle relies on you!
What does a growth mindset look like and why do you need it? Here is an example:
One of the first questions I ask leaders of nonprofits when I start working with them is “how do you set and create your organization’s annual need?” And 99% of the time the answer is given by telling me what amount of money the organization raised last year, and they hope to raise a little bit more this year.
I understand this line of thinking because, of course, every organization wants to raise as much money as possible every year. But it’s a reactive answer and indicates that leadership is not in control of the outcome, or worse yet, leadership doesn’t have a plan in place to reach their goals.
Every year, you should proactively establish an overall need to progress toward. This should not be set based upon the results of the previous year plus a slight increase. The organization’s annual need (not budget) should be known by all, including your donors. In every meeting, it should confidently roll off your tongue that “We have a $400,000 need this year to accomplish X, Y, and Z.”
The annual and actual financial need of your organization, along with the plans to raise it, will propel the mission forward. It is vital to create reachable goals annually so you can celebrate reaching those goals with your supporters.
Along the growth route, donors should be challenged to make larger investments knowing their expectations will increase proportionately. As gifts grow, the greater the expectation of reporting, accountability, and impact falls on your shoulders. You must be able to translate financial needs into what a donor’s investment can accomplish through your nonprofit.
So, what are the types of things you should consider budgeting for when establishing your organization’s actual financial need? (Remember, you must spend money to make money. This is an important part of the mindset shift.) Here are three priority areas you should consider making a bigger investment in as you embrace a growth mindset:
Hire a Financial Management Partner – If you are barely paying a bookkeeper who spits out untimely reports that don’t inform your next steps, it’s time for a change. Invest in a financial partner who not only performs your monthly bookkeeping but who also provides relevant reports, helps you understand your pinch-points, and establishes a process to keep you up to date on your numbers every month. You cannot grow if you are not in your numbers regularly.
Plan for People – Are you still wearing too many hats? How are you going to allocate enough time to fundraising if you are still running all the programs, creating every newsletter, and sending every receipt? Time is money and if you (the leader) aren’t spending over half of your time on donor relations then you will not grow. Reflect on what activities are consuming most of your time and ask yourself if you truly need to be the one performing these tasks. Start small if necessary – budget for a part-time person to be processing the gifts or writing thank-you letters. But you will continue to be spread too thin if you do not account for staff in the budget.
Invest in Fundraising Tools and Resources – We are in a competitive market. Right now, any of your donors could choose to give to ten other organizations who seemingly are doing similar work to you. One of the best things you can do for donors is make it an easy and pleasant experience to give. Is your Website easy to navigate, professional, and technology-relevant? Does your call-to-action messaging give clear and implicit instructions pointing donors to easy-to-use tools? Does your donor management software allow for deep segmentation so that you can customize engagement and interactions? All of these technologies and tools need to be up to date and easy to use.
Be mindful: are your activities mostly reactive to the urgent or proactive toward a plan? Are you performing more transactions with your donors or are you taking steps to create deep relationships? Are you checking all the boxes for the month or are you pausing to reflect how to do it better next time?
QuamTaylor LLC grows nonprofit organizations by providing strategic growth and development strategy. Walking hand-in-hand, Sherry will guide you through the core practices to keep your organization’s revenue growing, give you a fresh outlook on your growth potential, classify your priorities, and teach you how to create relationships with the right donors.